Are you thinking of becoming a landlord? You might have an unused property that is just sitting there when you know it can be a potential money-maker. But being a landlord is not an easy task. You’re going to have responsibilities and liabilities, more so if you are just starting in the business. Avoid making these errors especially if you are a newbie landlord:
Unaware of your duties
The first thing that you should know before you go and rent out your property is what your responsibilities would be as a landlord. It is not just one, but several duties — and this might overwhelm you. You will also be held liable for issues that can arise inside your property due to your negligence as the landlord. So ask yourself, “Am I capable to handle all these responsibilities?”
Know the risks of being a landlord. Do not just think of the profit you could make but also the hard work and challenges that come along with it.
Related article: How to be an Ethical Landlord
Mismanaging your time
If you are working a full-time job, you must know that being a landlord is also full-time. Your role does not stop when 5:00 pm comes around. Your tenants can call you up any time of the day and night if the need is urgent. You also have to allot your time for inspections, maintenance, repairs, and not to mention the unexpected problems your tenants will need your help for.
This becomes a bigger concern if you are managing multiple rental properties because you will be juggling a lot of responsibilities all at the same time. You have to manage your time well so that you don’t neglect to perform your other duties.
Unprepared Documents
Dealing with paperwork is part of managing a rental business. Keep important documents such as permits, logbooks, receipts, etc. You might need these documents at a moment’s notice so they should always be ready. Organize them so that you can find them easily in case you need to immediately access them.
Also, keep a calendar for documents that need to be updated on a certain schedule. That way, you won’t have to worry about late filings.
Lenient tenant screening process
You must have a checklist of the requirements you will need when screening a tenant. Applicants must submit those documents for you to perform a thorough screening. Do not just let anyone rent out your unit. Make sure that your tenant is trustworthy enough to take good care of it.
Even if the applicant is someone you know, try to screen them the same way you screen applicants you don’t know.
If you are too lenient from the beginning, your future tenants might take advantage of you. They might get the wrong impression that you are also lenient with your leasing rules and housing policies.
Not knowing all your landlord rights
Orient yourself with the law regarding lease agreements and your rights as a landlord. The laws on housing protect both tenants and landlords. Some laws might differ from state to state so you have to know your rights so that no one can exploit you in any way.
Overcharging
When you charge more than you should, they might not push through with the rental. You have to know that not everyone is willing to spend a lot of money on a house that they will never own.
Most tenants can settle with homes that only provide basic necessities, so they expect that it shouldn’t be too expensive. Set your rent rate according to the amenities and features your property can offer.
The same principle applies to charging pet fees and increasing rent. Tenants can also file a lawsuit against you if you charge them fees that are more than what is allowed by federal and state housing laws. Charging too much could make you lose money and tenants at the same time.
Not seeking professional help
You are a landlord but it does not mean that you are also a plumber, a mechanic, an accountant, or an exterminator. Know the advantage of seeking professional help when the situation demands it. Do not take on responsibilities that you cannot do properly just to save money. Partner up with service providers that you can trust to do those tasks that require skills that you don’t possess.
Do not harass yourself with too much work or else you might get tired of being a landlord too soon and give up a good source of income because it became too stressful for you.
Keep these things in mind if you are new to this and you will avoid the unnecessary stress that go with this business.
If you can avoid making these mistakes, then you’re on your way to becoming a better landlord. Go and purchase more properties you can rent out and create your listings at Padleads so you can syndicate those listings to popular rental websites. You will have applicants reaching out to you in no time.